Thursday Watch

Evening Headlines

Bloomberg:

• China's Cooling Property Market May Risk Economic Growth. Actions by China’s policy makers to rein in property prices in the bubble-prone nation may prove so effective that the economy’s growth rate could be affected next year. At least 21 cities have introduced purchase restrictions and toughened mortgage lending since late September, reversing two years of easing to support home buyers. Goldman Sachs Group Inc. says more tightening is likely to follow if prices keep soaring, while Citigroup Inc. estimates shrinking demand may lead sales volume to contract in the fourth quarter. 
• Asian Stocks Retreat as Commodity Shares Drop While Japan Gains. Asian stocks outside Japan fell for a third day as a stronger dollar weighed on commodity producers, while a weakening yen buoyed the Topix index. The MSCI Asia Pacific Index excluding Japan dropped 0.2 percent to 448.07 as of 8:07 a.m. in Hong Kong. Japan’s Topix index advanced 0.6 percent after the yen fell 0.7 percent on Wednesday.
• OPEC-Russia Roadshow Heads to Vienna for Crucial Oil-Cuts Talks. (video) OPEC’s effort to secure cooperation of non-members in a global deal to curb crude output will roll on from Istanbul to Vienna, with Russia on board but growing internal differences over sharing the burden of cuts. Russia is ready to participate in a “technical exchange” to set a road map for oil production levels in the Austrian capital on Oct. 29, Energy Minister Alexander Novak told reporters Wednesday. Talks in Istanbul were positive and cooperation between members of the Organization of Petroleum Exporting Countries and other producers is now well established, said Qatar’s Energy Minister Mohammed Al Sada.

Wall Street Journal:

• Future of Banking Looks Dark—Why That’s a Problem. Institutions’ sagging profitability poses wider threats to economic growth.
• America’s Dazzling Tech Boom Has a Downside: Not Enough Jobs. The discontent driving Donald Trump’s campaign stems partly from the dashed employment promises of the late 1990s; $7-an-hour robots.
• Biggest Economic Risk to Europe Lies in the Politics. Some policy makers say the potential for another shock to the eurozone is alarmingly high, Simon Nixon writes.

Fox News:

• FBI, DOJ roiled by Comey, Lynch decision to let Clinton slide by on emails, says insider. (video) The decision to let Hillary Clinton off the hook for mishandling classified information has roiled the FBI and Department of Justice, with one person closely involved in the year-long probe telling FoxNews.com that career agents and attorneys on the case unanimously believed the Democratic presidential nominee should have been charged.

MarketWatch:

• Why China’s banks may eventually need a nearly $2 trillion capital infusion.

CNBC:

• Earnings up next for markets with Fed believed to be still aiming for December. (video)
• A Democratic sweep is a realistic possibility, conservative scholar says. (video)

Zero Hedge:

• Will Eliminating Cash Save The Economy? (Spoiler Alert: Don't Be Stupid!).
• Steve Cohen Boosts Bonuses For Top Traders, But... (graph)
• The Beer Goggles Stock Market.
• Wells Fargo CEO John Stumpf To Retire Effective Immediately.
• Oil Tumbles After Biggest Crude Inventory Build In 6 Months. (graph)
• Stocks Steady After Fed Despite JOLTS Slump, Crude Dump, VIX Jump. (graph)

Business Insider:

• Multiple women say Donald Trump made inappropriate sexual advances on them.
• Challenging Iran is 'the last thing' Obama wants to do — even as Iran-backed militants fire on US Navy ships.
• There has been a big shift inside the Federal Reserve. In the minutes for the central bank's Federal Open Markets Committee September meeting, several higher-ups at the Fed hinted that the policy of historically low interest rates was doing more harm than good to the economy.
• New email suggests DNC chair had exact CNN town hall question in advance.
• The economic outlook is gloomy, and this time the government can't help.

Telegraph:

• If Europe insists on a hard Brexit, so be it.

Night Trading 

• Asian equity indices are -.5% to +.5% on average.
• Asia Ex-Japan Investment Grade CDS Index 116.75 +5.75 basis points. 
• Asia Pacific Sovereign CDS Index 34.25 +1.25 basis points.
• Bloomberg Emerging Markets Currency Index 72.71 -.07%. 
• S&P 500 futures -.06%. 
• NASDAQ 100 futures -.03%.

Morning Preview Links

Earnings of Note
Company/Estimate 

• (DAL)/1.66
• (LNN)/.41
• (PGR)/.33
• (TSM)/3.68
• (WGO)/.49

Economic Releases
8:30 am EST

• The Import Price Index MoM for September is estimated to rise +.1% versus a -.2% decline in August.
• Initial Jobless Claims for last week are estimated to rise to 253K versus 249K the prior week.
• Continuing Claims are estimated to fall to 2050K versus 2058K prior.   

Upcoming Splits 

• None of note

Other Potential Market Movers

• The Fed's Harker speaking, ECB Decision, ECB press conference, $12B 30Y T-Bond auction, China CPI report, Bloomberg US Economic Survey for October, weekly Bloomberg Consumer Comfort Index, weekly EIA natural gas inventory report, (HPQ) analyst meeting, (ULTA) investor day and the (SAFM) investor conference could also impact trading today.

BOTTOM LINE:  Asian indices are mostly lower, weighed down by commodity and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower. The Portfolio is 25% net long heading into the day.